Public Finance

Module code: MN7620

The public sectors of developed and developing nations play a significant role in terms of the impact of taxation, borrowing and regulation upon private sector decision-making and activity. The budget of the public sector is not neutral. At the same time the resources absorbed by the public sector have to be managed efficiently and effectively in order to ensure maximum benefits and value for money. Modern public sectors need to embrace the lessons of performance management in their budgeting processes.

In this module we will examine the settings of public sector budgets within the framework of impact analysis and performance management.

Topics covered

  • The rationale of the state; the purpose of taxation; the design of an optimal tax system
  • The impact of taxation on savings and investment
  • Corporate taxation – impact on real asset valuation
  • The impact on financing choices; tax effects on dividends and share repurchasing
  • Fiscal policy – use of taxation and public sector borrowing for macro purposes
  • Measuring public sector deficits; financing public sector deficits; the co-ordination of monetary and fiscal policies
  • The impact of public sector deficits
  • Resource based budgeting – the public sector budget making process; performance measurement and value for money auditing

Assessment

  • Essay, 4,000 words (100%)